Posted by swamphawk22 on 3/20/2013 5:27:00 PM (view original):You still seem to view the economy as infinite.

If we keep borrowing that ties up a part of the economy.

You can argue if that makes the economy sluggish, but you cannot argue that there is only so much money. We are not priniting money out of the blue, we are borrowing it from someone else.

That's the point. We're borrowing money that would otherwise be sitting still in a savings account or CD. Even if the government is wasteful and inefficient, wasteful and inefficient spending is better (for the economy when demand is depressed) than no spending.

If there was some shortage of capital, I'd agree with you. But we had the exact opposite. Public companies and banks were flush with cash. They just didn't have a reason to spend it because of the depressed demand.